Procast Guss is repositioning itself under its own management

The internationally active foundry company Procast Guss GmbH has started a restructuring process. This is how the company is adapting its structures to the current requirements of the market and its customers. Procast is using the legal possibilities of a self-administration procedure for the reorganisation.

‘From our customers‘ point of view, Germany, with its high energy costs, is increasingly a risky location for foundries,’ emphasises managing director Patrick G. Weber. ‘We want to further expand our market position as a leading European customer foundry. To do this, we have to adapt our capacities in Germany to the requirements and call-off figures of our customers. The self-administration proceedings that have now been initiated offer us the necessary options and instruments for this.’

The management of Procast Guss GmbH therefore submitted a corresponding application to the District Court of Bielefeld this week. The court has approved the application and ordered preliminary debtor-in-possession proceedings. Business operations will continue in full at the company's two production sites in Gütersloh and Nortorf, i.e. orders will be processed and delivered as usual. The wages and salaries of the approximately 225 employees affected are secured. Invoices will also continue to be paid in accordance with the applicable provisions of the self-administration.

The self-administration procedure offers companies a legal framework for quickly and effectively implementing necessary restructuring measures while business operations continue. The management remains in office and manages the restructuring itself. In doing so, it can resort to a number of instruments that are not available outside of such proceedings. For example, contracts can be terminated more easily and necessary restructuring measures can be implemented particularly quickly and effectively. The procedure is only open to companies that address their economic difficulties at an early stage and where there is sufficient scope for a solution. Both of these conditions are met by Procast Guss GmbH.

The company has appointed the experienced restructuring expert Patrick G. Weber as managing director (CRO) for the duration of the restructuring. He will manage the implementation of the reorganisation together with the general representative, the Hamburg-based lawyer Andreas Romey from the law firm ECKERT RECHTSANWÄLTE. The previous managing director Graziano Sammati is concentrating on his role in the sister company in Spain, and in particular on the further ramp-up of production there. The court has appointed Dr Marcel Streeck from the law firm Münzel & Böhm as the provisional insolvency monitor to supervise the restructuring in the interests of creditors.

The self-administration proceedings relate exclusively to Procast Guss GmbH, which has two plants in Gütersloh (around 145 employees) and Nortorf (around 80 employees). The company decided to close its site in Bad Saulgau some time ago. This is currently being implemented and will be completed by the end of the year.

Unlike many of its competitors, the Procast Group, with its four production sites in Gütersloh, Nortorf, Kiel and Abadiño in northern Spain, has a broad and solid base overall. However, like the entire German foundry industry, the group is suffering from high energy costs and the weak economy in Germany. The Gütersloh site in particular is under particular pressure due to its high cost structure. Procast Handform GmbH in Kiel and Procast Guss Espana S.L in Abadiño in northern Spain, which also belong to the Procast Group, are not affected by the restructuring.

Private Assets, the shareholder of the Procast Group, supports the restructuring. ‘We continue to believe in the foundry business and, above all, in our European foundry group,’ said Sven Dübbers, CEO of Private Assets AG. ‘Now that we have modernised the company and given it a broader base by acquiring the site in Spain and investing in the other sites, we are now tackling the cost structure in Germany with determination. This will enable us to position the company competitively in the long term and, above all, to secure production in Germany.’